Senate Health Bill 2.0: What You Need to Know

Senate Health Bill 2.0: What You Need to Know
Senate Health Bill 2.0: What You Need to Know

Senate Republicans released version 2.0 of their healthcare bill yesterday. Overall, the bill closely hews to the last version of its repeal-and-replace "Better Care Reconciliation Act of 2017" and contains very few provisions that will directly impact the employer market.
 
Key changes affecting the employer markets:
  • Retains the ACA Medicare and net investment taxes for high income individuals, both of which would have been eliminated under both the House bill and the prior Senate bill
  • HDHPs must not include coverage for abortion to qualify for HSA contributions
  • Adds new provision allowing HSA funds to be used to purchase health insurance (subject to certain restrictions)
  • Small Employer HRAs: deletes requirement that HRA paid-for coverage be "affordable"
  • Small Business Health Plans: these provisions first included in the prior Senate bill are retained but have been modified somewhat. It does not appear that any of the modifications are significant
  • HSA "qualified medical expenses" expanded to now include medical expenses for dependents up to age 26
 
Other changes of note:
  • Retains the excise tax on health insurance providers who pay executives more than $500k per year (which would have been eliminated under both the House bill and the prior Senate bill)
  • Allows health insurers to offer catastrophic coverage in any market without age restriction provided that they offer at least one full coverage option in that market
  • Adds $70 billion in new funding for insurers insuring high risk individuals and who agree to offer coverage in under-served markets
  • Compared to the last version on which we reported, the bill does have a continuous coverage requirement equaling a mandatory six-month waiting period for coverage if an individual can't demonstrate 12 months of continuous coverage; notably, places obligation on issuers to certify/report months of "creditable coverage" and waiting periods (this differs from the House bill, which would put reporting obligation on employers on W-2s)
 
Source: The Council of Insurance Agents & Brokers and their legal team Steptoe & Johnson.
 
The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a 'covered opinion' or other written tax advice and should not be relied upon for any purpose other than its intended purpose.

 

The information provided is for educational purposes only. This information is from sources we believe to be reliable, but we cannot guarantee or represent that it is accurate or complete. The opinions are those of the writer, and the opinions and information presented are subject to change without notice.

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